r.c. here is the article, sans the video clips
The Northern Miner Volume 83 Number 7 April 14, 1997
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***NEWS FLASH -- SPECIAL REPORT*** -- Video shows Bre-X crushed
samples on site
BY JAMES WHYTE AND VIVIAN DANIELSON
David Walsh, president of Bre-X Minerals(BXM-T), may want the world to believe that
there is no possible way core samples from the Busang project in Kalimantan, Indonesia,
could have been tampered with before they were sent to an Indonesian lab for assaying.
In a recent interview with The Wall Street Journal, Walsh said core samples measuring
several feet long were broken up "only enough to fit into hand-carried bags for
transporting to Indo Assay [Laboratories]."
Not long after making this claim, Bre-X issued a fax acknowledging that "waste intervals" of core
were crushed on site. A description of its sample preparation procedure was faxed to a number of
mining analysts and posted on the company's site on the World Wide Web.
But now there is evidence that Bre-X's claims that IAL did the preparation and crushing of the
samples are not correct. A videotape has surfaced that clearly shows that samples of drill core
from mineralized drill holes were crushed, pulverized and homogenized at the company's Busang
sample preparation facility before being packaged into 2-kg samples for shipment to the
independent lab in Balikpapan for analysis.
The video, obtained by The Northern Miner, was shot by a mining analyst on a visit to the property
in June 1996. It shows a tour of Bre-X's sample preparation facility, in which site manager and
metallurgist Jerome Alo describes the sequence of steps in Bre-X's sample preparation. Alo shows
the visitors the project's jaw crusher, hammer mill and grinder, all of which are used to crush and
pulverize rock. He goes on to show the lab's rotary and riffle splitters -- two devices used in assay
labs to divide out representative portions of crushed or ground samples. At the end of the visit to
the sample preparation lab, Alo displays a labelled sample bag ready for shipment to IAL. It
contains about 2 kg of drill core ground to 200-mesh -- that is, the pulverized rock would pass
through the 74-micron (0.074-mm) openings of a 200-mesh particle sieve.
The bag Alo displays on the video bears the number BSSE-75/07065, signifying that it came from
borehole BSSE-75 -- a hole near the middle of section line SEZ-54. A table of results issued by
Bre-X in January 1996 showed hole BSSE-75 grading 2.26 grams gold per tonne from 53 to 64
metres downhole, and 2.34 grams per tonne from 123 to 442 metres downhole. The second
interval included a 40-metre intersection grading 3.99 grams.
At another point on the video, the visiting analysts and Bre-X geologist Michael de Guzman are
shown discussing holes BSSE-95 and BSSE-96 over a drill hole location plan. A visitor asks if
core samples from one of the holes can be seen. De Guzman replies, "only some pulps . . . it's over
there." Bre-X subsequently reported two mineralized lengths, one of 347 metres and another of 22
metres, from hole BSSE-95, and four mineralized intersections, ranging from 4 metres to 294
metres, from hole BSSE-96.
The video casts into serious doubt Bre-X's contention that only unmineralized samples were
processed at the Busang lab (unless all samples were unmineralized). At the start of the tour, Alo is
shown tracing the progress of Busang drill core samples on a flow chart pinned up in the Busang
lab. He says the samples are dried, jaw-crushed and divided using a riffle to provide a 1.5-kg
sample for metallurgical testing. (This is consistent with information released to the press by
Normet, Bre-X's Australian metallurgical consultants, who said the samples they received "were
split out from reserve crushed core samples.") It is not usual industry practice to save portions of
"unmineralized" samples for metallurgical tests.
Another of Alo's statements appears to undermine the Bre-X version of its sample methodology.
Asked what difference there was between duplicate samples sent for cyanide leach assay, he
replied "20%" -- that is, if two 750-gram portions of the same drill core sample were assayed, one
portion might grade 2 grams per tonne and the other, 2.4 or 1.6 grams.
This is not surprising. Duplicate samples sent to assay laboratories frequently differ in their results,
partly because of laboratory variation and partly because duplicate rock samples never carry
exactly the same amount of gold. Since gold occurs as a native metal in trace amounts, a sample of
mineralized material will contain only a little gold, contained in a relatively small number of grains --
and the grains are distributed randomly and unevenly throughout the sample. Large portions of the
sample, such as a 750-gram cyanide leach portion, will be more likely to carry their fair share of
gold than small portions.
A standard work on gold sampling issued in 1969 by four scientists at the U.S. Geological Survey
shows that a 750-gram sample of material, with gold flakes that average 200 microns in diameter
and a grade around the Busang average of 2.5 grams per tonne, should have an inherent variability
around 17%. This is not far from Alo's claim of 20%. But unmineralized material with gold grains of
the same size, grading perhaps 0.5 gram per tonne, should vary at least 40%.
Bre-X spokesman Steven McAnulty could not comment on technical questions posed by The
Northern Miner. He asked that a written list of questions be submitted and at presstime, no further
comment had been received.
The video also included a brief flyover of the camp and drill sites at Busang. Drill sites could be
seen easily from the helicopter, but there only appeared to be a few. This is surprising, considering
that more than 96 holes had ostensibly been drilled at that time. Drill data related to some of
Bre-X's holes were reported to have been lost in a fire earlier this year at Busang.
Artisanal mining
Companies operating gold mines in Indonesia often have problems keeping away artisanal miners
who hope to eke out a living recovering gold from alluvial gold from streams and rivers that drain
the deposit, or from surface exposures of vein systems associated with the deposit. "Busang never
had this problem," said a source who spent months in Indonesia on a nearby project.
"We've heard that some local miners went to the site [after the discovery was announced] and
weren't able to do better than 0.2 gram gold per day. This doesn't make sense when you consider
that at Kelian and Mt. Muro, security forces are needed to keep local miners out, and when you
consider all the coarse, free gold that is supposed to occur at Busang." This view was confirmed in
an April 10 report by John Stackhouse of The Globe and Mail, who noted that Bre-X is "not the
only one struggling to prove there's gold" at Busang. After visiting Mekar Baru, the only Dayak
(aboriginal) community on the Busang property, Stackhouse reported that, for two years, villagers
had been unable to find gold in the web of rivers and streams that flow through their traditional
grounds. Nor was there any evidence of artisanal mining during a site visit by The Northern Miner
in the summer of 1996.
If the Dayaks are skeptical about Busang, several Australian companies must be scratching their
heads about how Bre-X could churn out "millions of ounces" when, at best, they only were able to
find spotty, discontinuous mineralization in the Central zone. A Canadian geologist, just returned
from Indonesia, says the Australians hit relatively narrow, vertical shoots (up to 2-metres) with
grades of 1 or 2 grams, separated by wide areas barren of mineralization.
Mineralogy and metallurgy
A paper on the geology of Busang, written by de Guzman, Bre-X vice-chairman John Felderhof
and geologists Jonathan Nassey and Cesar Puspos, documented gold mineralogy at the Busang
deposit that strongly implies the gold is fine-grained (T.N.M., April 7/97). They reported gold
occurred as the free native mineral and as inclusions in sulphides, which were themselves
fine-grained.
De Guzman's videotaped description of a gold-mineralized sample is fully consistent with the
fine-grained model: he points out dense hydrofracturing with multiple orientations, as well as
fine-grained sulphides, including pyrite, arsenopyrite and chalcopyrite. The sample had no visible
gold. De Guzman's prediction of the grade was 5 grams per tonne.
Yet the Normet metallurgical study found that most of the gold in the crushed samples it received
from Bre-X was in particles "mostly 100 to 400 microns" (or 0.1 to 0.4 mm). The study noted that
"one ten-micron piece of electrum [a mineral consisting of alloyed gold and silver] was observed in
galena hosted by coarse marcasite." Other observations made by Normet are consistent with
placer gold. Many of the gold grains showed "distinct gold-rich rims," a feature often found in
placer grains because silver, more chemically reactive than gold, leaches away. A large fraction of
the gold -- 91% -- was recoverable by gravity, which is rare in hard-rock gold deposits.
Normet's cyanidation tests found that "there was no apparent relationship of grind size with
extraction." This implies that all the gold in the sample was liberated at a relatively coarse grain size,
and is fully consistent with a placer source.
Normet's report said that "leach kinetics were shown to be relatively slow for all samples," with a
24-hour leach resulting in a mean gold recovery of 81%. Such slow recoveries suggest that the
gold was in relatively coarse grains, which cyanide takes longer to dissolve.
Few Canadian geologists have worked at Busang and, as a result, little information about Busang's
mineralogy has emerged since Felderhof and de Guzman wrote their first technical paper on
Busang. Since then, almost no information on this subject been made available by Bre-X, other
than McAnulty's recent statement that Busang has "three shapes" of gold; "largely free gold that has
a nuggety effect," with some "rounded," and some having a third shape, which he did not know
how to describe.
One Canadian geologist, who worked splitting core for three months at Busang in 1995, told
friends the gold was so fine that nothing was visible. The same geologist told The Northern Miner
that de Guzman was "very secretive" of geological information, which he shared only with his own
crew of Filipino geologists. Another indication of the fortress mentality at Busang was the fact that
were no Canadian geologists in any senior capacity, despite the "millions of ounces" of gold then
reported to be rolling off the assembly line. As well, Bre-X did not bring in any North American
consultants with expertise in geochemistry, geophysics, mineralogy and other disciplines to work on
site with de Guzman's small crew.
Bre-X director Paul Kavanagh is probably right when he said there can only be two explanations
for why Freeport McMoRan Copper & Gold (FCX-N) failed to intersect any mineralization during
its recent 8-hole confirmatory drill program at Busang. "Either [it is] a massive salting operation, or
Freeport is wrong," he told a wire service.
It is highly unlikely that an experienced mining company such as Freeport could be so incompetent
as to miss mineralization which a small, Calgary-based junior never failed to find, unless it was
never there in the first place.
Nor would Freeport, whose board includes former U.S. Secretary of State Henry Kissinger, put
itself at legal risk by calling attention to "visual differences" between the gold grains in its own
samples and Bre-X's, unless it was positive of the finding.
There remains, of course, a thread of hope that the 6-hole audit drilling program being carried out
by Strathcona Mineral Services, a respected consulting firm, will turn out results similar to those
previously reported by Bre-X. But because Strathcona already has described Bre-X's samples as
"invalid," -- and stated that there "appears to be a strong possibility that the potential gold
resources were overstated" because of assaying of those samples -- the thread appears to be thin
and perilously close to snapping.
The links below lead to the following short avi-format clips from amateur video shot during a visit
to the Busang project in June 1996: Clip one shows a flow chart of drill core sample preparation at
Busang, indicating that samples were crushed and that a portion was reserved for metallurgical
testing.
Clip two is footage of Jerome Alo showing the jaw crusher and hammer mill to Busang visitors. On
the far right is the splitter.
Clip three shows site manager Jerome Alo holding a sample bag filled with crushed core from a
2-metre interval of hole BSSE-75, where Bre-X reported mineralized intersections of 11 and 319
metres.
putting all this aside, my new theory is that salting did not occur, but when they were drilling the holes through the thick forestation, several of the holes were drilled through shallow ponds containing gold fish. as the drills turned the goldfish were sucked into the hole and they inturn were dispersed in a sort of epithermal reaction. this can be proven because the gold said to be found had rounded shapes similar to placer type gold and fish scales. secondly there has been talk of of other geologists smelling something fishy when looking at the pulverized drill cores. now we know the cause and result. dead fish smell and their scales were heated up by the drill bit to imitate placer type gold. if only we can find mike deguzman, the alchemist of the 20th century. one last tidbit, when mike was in new york a couple of years ago during a david copperfield show he was seen backstage talking to david. they were discussing......
regards,
clif
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